Punjab-Haryana High Court
Commissioner Of Income-Tax, Punjab, ... vs Jagatjit Distilling And Allied ... on 25 August, 1960
Equivalent citations: [1961]41ITR328(P&H)
JUDGMENT
KHOSLA, C. J. - In these two cases (Income-tax Cases Nos. 4 and 5 of 1957), after hearing counsel for parties, we are satisfied that no question of law arises, and if the point, which has been formulated by the of law arises, and if the point, which has been formulated by the Commissioner of Income-tax, is to be regarded indeed, as a question of law, then the question is well settled by authority. Some of the share-holders of the assessee company made a winding up petition, and in the litigation which followed some expenses were incurred by the assessee company as legal expenses and as traveling expenses paid to their employees and counsel in connection with the litigation. Since the very existence of the company was threatened in this litigation, it was part of the business of the company to defend this litigation, and it is clear that, following the decision of the House of Lords in Morgan (Inspector of Taxes) v. Tate & Lyle Ltd., these are expenses which are deductible under section 10 (2) (xv) of the Income-tax Act. The matter having been well settled by authority (there are other similar cases to which a reference need not be made), no question of law arises for the opinion of this court under section 66 (2) of the Income-tax Act. We, accordingly, dismiss both these petitions. There will be no order as to costs.
MAHAJAN, J. - I agree.
Petitions dismissed.